This excerpt taken from the KOG 8-K filed Aug 7, 2009.
During July 2009, Kodiak closed on a previously announced agreement to acquire additional interests in the Tall Bear prospect area. Separately, the Company entered into a joint venture arrangement with a private industry partner pursuant to which Kodiak conveyed certain of its leasehold to the joint venture partner resulting in a sell-down of 3,300 net acres to Kodiaks leasehold in the Charging Eagle and Tall Bear prospects, collectively referred to as the Twin Buttes area. After netting out the costs to acquire the additional interests in the Tall Bear prospect area, Kodiak realized $1.85 million in cash from the sell-down, and will pay 50% of the first five wells drilled in the Twin Buttes area for its 60% WI, proportionally reduced.
We are delighted to have our new partner participating with us in drilling the southeastern block of our FBIR leasehold, said Mr. Peterson. As the southern block represents about 30% of our leasehold, these are important delineation wells. By selling down certain of our interest, it maintains the Kodiak working interest in the 50%-60% range, which allows us to operate while adhering to our capital expenditure budget.